Market likely to consolidate in overbought zone
50-day SMA or 57,600 would act as a trend decider level. Above the same, the uptrend wave will continue till 58,300-58,500. On the flip side, below 57,600 uptrend would be vulnerable
image for illustrative purpose
Stock Picks
- SRF: Above Rs2680 with a target of Rs2705 and Stop loss of Rs2650. The stock is in positive momentum and is at the support of 8 and 40 EMA.
- STERLITE TECHNOLOGIES: Above Rs226 with a target of Rs235 and Stop loss of Rs218. It has a support of 8 EMA and has given a breakout in smaller time frame.
- IEX: Above Rs235 with a target of Rs242 and Stop loss of Rs229. It is at the support of 8 and 40 EMA.
- TATA COMMUNICATION: Above Rs1205 with a target of Rs1235 and Stop loss of Rs1180. It has reversed from the recent support zone.
- ADANIGREEN: Above Rs1950 with a target of Rs1985 and Stop loss of Rs1925. It has reversed from the support of 8 and 40 EMA.
(Source: Capital Via)
For the traders, the support shifted to 57,550 from 56,900, can expect the level of 58,000-58,400 if the index succeeds to trade above 57,550; on the flip side, dismissal of 57,500 may increase further weakness till 57,300-57,100
Mumbai: After a strong uptrend rally, the benchmark indices witnessed profit booking at higher levels. The BSE Sensex was down by 304 points. On Wednesday, the market opened with a gap-up, but due to consistent profit booking at higher level it corrected sharply. From the day highest level, BSE Sensex shed over 840 points. Sector-specific, metal index rallied over one per cent, while some profit booking was seen in Auto and financial stocks.
Technically, on intraday and daily charts the index is holding higher bottom formation, but at the same time, it consistently facing resistance near 58,400.
"We are of the view that, the short-term trend is up, but due to temporary overbought situation market is likely to consolidate. For the traders, the support shifted to 57,550 from 56,900," says Shrikant Chauhan, head of equity research (Retail), Kotak Securities. "We could expect the level of 58,000-58,400, if the index succeeds to trade above 57,550. On the flip side, dismissal of 57,500 may increase further weakness till 57,300-57,100," he added.
Even as global cues remained positive, Indian equities continued to fall in the late afternoon session. Traders were concerned when the Ministry of Petroleum and Natural Gas released its monthly production report for February, which revealed that crude oil production fell short of target and was lower in terms of year-over-year (y-o-y) data for the period; while natural gas production was higher in y-o-y terms, but still fell short of the monthly target, an analyst said.
On the international front, Asian markets were mainly in the green, after a rise in New York, as investors bet that the Federal Reserve's decision to raise interest rates will help bring inflation under control.
